Analyzing National Australia Bank's Sustainability Management Approach

This report provides a comprehensive analysis of the sustainability practices of National Australia Bank (NAB). It begins with an executive summary highlighting NAB's commitment to sustainability reporting, its alignment with the United Nations Sustainable Development Goals (SDGs), and its support for indigenous populations. The report then delves into NAB's approach to sustainable practices, emphasizing its integration of Environmental, Social, and Governance (ESG) factors into its risk management framework and its use of a Green Bond Framework to support a low-carbon economy. The analysis examines NAB's sustainability reporting, including its environmental operational targets and its investments in energy-efficient assets. The report also discusses NAB's 'Outside in' strategy, its commitment to reducing paper usage and waste, and its role in promoting comprehensive credit reporting and open banking. The conclusion summarizes NAB's evolution through different phases of sustainability, highlighting its responsiveness to governmental regulations and societal expectations.

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Executive Summary
Sustainability Reporting is used as summary of regulatory, ecological and communal effects of
companies because of their daily activities. This type of reporting has enabled NAB to
emphasize their guarantee towards global economy further assisting them to measure,
comprehend and connect with financial, environmental, administrative and social performances,
Sustainability Reporting further has been serving NAB to effectively set up goals and attain
essential changes in highly operative method. NAB has built robust community for
strengthening global competition on SDGs presented by the United Nations Assembly as vital
part of its 2030. NAB redirects organisation’s approach towards life and also highlights on the
business’s determinations towards doing something unlike, particularly by monetarily and
socially supporting the Indigenous populace of Australia and aids them to advance and prosper.
NAB with its recurrent supportable practices has been reassuring to ongoing immediate revenues
to found continual relations with stakeholders who serve highly imperative role for
organizational supplies. On the other hand, Stakeholder theory clarifies essential aim of
organization in generating importance for its investors at all levels. NAB has built stronger
community for reinforcing global competition on SDGs introduced by the United Nations
Assembly as vital part of its 2030 Agenda. The following paper has offered comprehensive
insights and analysed National Australia Bank sustainable practices by shedding light on its
current activities and contribution towards people and the planet.

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Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................3
NAB approach towards sustainable practices..............................................................................3
NAB’s ESG (Environmental, Social and Governance) Risk Management and Green Bond
Framework...................................................................................................................................4
Green Bond Framework..............................................................................................................5
Sustainability Reporting Undertaken by NAB............................................................................5
NAB Investments on Energy Efficient Assets.............................................................................6
NAB’s ‘Outside in’ Strategy.......................................................................................................7
Conclusion.......................................................................................................................................8
References........................................................................................................................................9

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Introduction
National Australia Bank is recognised as one of the four largest financial organisations in
Australia in terms of revenues client and market capitalisation. Being one of the largest business
banks, NAB has been working with small, medium and large businesses and support them to
every stages of the business growth. Official website of the company highlights that NAB
financially aids some of the most important infrastructures in the Australian communities which
includes educational institutions, hospitals and transportations (NAB.com 2019). NAB's vision
relies on being Australia’s primary bank, which will be trusted by wide range of customers for its
outstanding services (Lewis 2016). Additionally, the core purpose of NAB principally guide and
motivate the company’s board, its leaders and most importantly the people in order to deliver
industry leading sustainable results for its customers, stakeholders and most importantly to the
broader community. NAB set targets as well as assurances in order to attain improved business
as well as social outcome (Rashidi and Cullinane 2019). This targets support the United Nations
Sustainable Development Goals (SDGs) direction to stronger future, for the people and the
planet. The following paper aims to analyse National Australia Bank sustainable practices by
shedding light on its current activities and contribution towards people and the planet.
Discussion
NAB approach towards sustainable practices
Corporate Social Responsibility and sustainable practices reinforce key business
strategies with the core purpose of establishing value over long-term management approach 9
(Hetze and Winistörfer 2016). NAB considers effective management of environmental,

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administrative, social performance along with significant prominence recognition support from
shareholders in order to accomplish sustainable practices within the organisation (Rockström et
al. 2017). The official website of NAB mentions the significance of its stakeholders especially
distributors as highly important associates in order to undertake a sustainable performance not
only towards the people they serve and to the planet. Furthermore social impact framework of
NAB reflects organisation’s approach towards life and also emphasizes on the company’s efforts
towards doing something unlike, especially by financially and socially supporting the Indigenous
population of Australia and helps them to progress and prosper (Islam, Jain and Thomson 2016).
NAB’s ESG (Environmental, Social and Governance) Risk Management and Green
Bond Framework
Comprehensive studies of authors mention that although Australia has been able to rise
above its financial crisis as compared to other developed countries, there are certain issues such
as, unequal income distribution, which is bothering the country along with its slow income rate
with unstable political landscape (Visser and Tolhurst 2017). These issues are linked to NAB's
perception regarding sustainable practices. NAB has recognized, assessed, observed, reported
and supervised ESG risks based on the Group’s Risk Management Framework (RMF) that aligns
in coordination with the Group’s Risk Management Strategy. Reports reveal that NAB’s ESG
Risk Principles offers principal framework meant for containing ESG risk concerns in the RMF
as well as in daily administrative processes (Insight 2015). On the other hand, used interior
procedures (employee engagement review, peer appraisal, appealing to community associates,
revising ESG enactment in sustainability rating benchmarks) shared with external outlines and
ethics (Global Reporting Initiative, Sustainable Development Goals, Sustainability Accounting
Values Board) to review their status of relevance (Carè 2018).

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Green Bond Framework
NAB introduced the Green Bond Framework relates to issuances or objects of ‘green’
instruments identified after as per the Climate Bonds Standards of Climate Bonds Initiative. As
per reports, the Framework applies to all prospective issuances of NAB SDG Green Bonds,
which will successfully address Programmatic Certification under the Climate Bonds Standards.
Under this framework, NAB in 2015 has declared its assurance to undertake ecological financing
activities, which includes the issuance and arrangement of green bonds of around A$18 billion
by 2022 in order to support the transition to reduced carbon economy (Carè 2018).
Sustainability Reporting Undertaken by NAB
The Global Reporting Initiative (GRI) states that Sustainability Reporting is used as an
outline of monetary, ecological and social effects of companies due to their daily activities.
According to Adams et al. (2016), this type of reporting has facilitated NAB to underline their
assurance towards international economy further enabling them to assess, understand and link to
financial, environmental, administrative and social performances, Sustainability Reporting
further has been helping NAB to successfully set up goals and attain essential changes in highly
effective method. As per reports, NAB has built stronger community for reinforcing global
competition on SDGs introduced by the United Nations Assembly as vital part of its 2030
Agenda. NAB’s Group environmental operational targets reveal company’s Science-based GHG
emissions (tCO2-e) – 21% reduction by 2025, water consumption to be reduced by 10% by
2020, decrease of office paper (tonnes) by 10% reduction within 2020, 5% reduction of waste to
landfill by 2020 and condense consumption of data centre Power efficiency below 1.5 by 2020
(Jain, Keneley and Thomson 2015). All these Group environmental operational targets are
undertaken to reach SDG 7 (Affordable and Clean Energy), 9 (Industry, Innovation and

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Infrastructure), 12 (Responsible Consumption and Production), 13 (Climate Action) and 14 (Life
Below Water). Meanwhile, about 90% of material dealers align with NAB’s Global Supplier
Sustainability Principles (GSSPs) in addition to 100% of recent or re-contracted suppliers
evaluated for Environmental, Social as well as Governance (ESG) jeopardies every year
(NAB.com. 2019).
NAB Investments on Energy Efficient Assets
Comprehensive studies of authors have observed increased competition due to
deregulation, thus consequential to intense impact on society. These impacts are critically
associated with staff economizing. In addition to this, there has been observed concentrated
media and public investigation by essentially accentuating banking sector. Although, number of
studies has been conducted considering Corporate Social Responsibility (CSR) in addition to
social reporting by financial organizations, many have taken into account social reporting as
methods of acting responsive towards disapproval rather than serving as part of strategy in order
to interrelate with investors. Studies conducted by Sam and Tiong (2015) have mentioned that
organisations by drawing relevance to stakeholder theory have been running not only in
consideration of stakeholders and investors but also by taking into account importance of
stakeholders for example staffs, consumers and communities. Moreover, NAB with its repeated
sustainable practices has been supportive towards continuing immediate revenues to establish
continual relations with stakeholders who serve highly imperative role for organizational
provisions. However, the theoretical explanation of Stakeholder theory elucidates essential aim
of organization in generating importance for its stakeholders at all levels (Visser and Tolhurst
2017).

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Reports of Visser and Tolhurst (2017) have mentioned that Australian farmers along with
Agribusiness owners have controlled their practices in order to reduce energy outlays and
successfully transform their energy consumption further claiming that NAB and the Clean
Energy Finance Corporation (CEFC) will offer an added $180 million in business for
investments in energy efficient and renewable energy equipment. Furthermore, as per reports, the
recent investment NAB’s effective Energy Efficient Bonus program to around $300 million. The
initiative offers NBA clienteles with around 0.7% reduction on its standard equipment finance
rate for credits, which condensed energy-consumption or produce renewable energy. This
primarily includes motors, efficient irrigation systems in addition to lighting exaltations as well
as processing line improvements and refrigeration. Furthermore, NAB through sustainable
reporting has assured renewable energy as well as energy efficiency technologies for decreasing
greenhouse gas releases and environmental protection (Jain, Keneley and Thomson 2015).
Furthermore, efforts for lessening the increasing demands for emissions-intensive imports and
services, major standard of public in addition to private infrastructure further will need to be
interchanged or transformed. NAB Investments on Energy Efficient Assets has been offering
prospects to invest in the technology, physical vegetation, apparatus and substructure, which
aims to deliver emissions reduction results.
NAB’s ‘Outside in’ Strategy
By evaluating sustainability practices of National Australian Bank, it has been observed
that NAB, as leading bank in Australia has showing utmost care for the planet through adaptation
of sustainable approach for managing business and aiding clientele for undertaking similar
approaches. For example, NAB’s significant sustainable practices include 20% reduction of
paper usage from 2015 baseline along with 54% of waste diverted from landfill. In addition to

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this, NAB has recently aimed to issue Climate Bonds Standard certified green bond.
Furthermore, NAB is committed to environmental investments of around $ 55 billion to achieve
by 2025 in order to address climate change. Report of Rupley, Brown and Marshall (2017) has
revealed that NAB has taken positive positioning on the introduction of CCR (Comprehensive
Credit Reporting). Furthermore, in 2018, NAB has gained the position of being first bank in
Australia, which is ahead of legislative mandate for taking participation in CCR for personal
credit cards and overdrafts, and aims to proceed towards broader rollout. In addition to this, the
inauguration of Open Banking in 2019 has offered significant avenues for customers, thus
providing greater control of their data and humanizing the way data can be shared. Furthermore,
NAB has accentuated on ensuring advancement done in way, which will guarantee the safety and
security of customer figures and information (Hetze and Winistörfer 2016).
Conclusion
Therefore, from the above discussion it can be concluded that NAB through its
sustainable practices can be considered as second wave organizations as per phase model. NAB
exists in three phases namely compliance, efficiency or strategic proactivity. As per phase model
the NAB aims to withdraw from practices which pose impact to the environment and recognize
minimal values in lieu of human resource practices. While, NAB has been recognized as
responsible corporate citizen, it has not being equally responsive towards legal requirements and
societal expectations. NAB through these strategies has been responsive towards governmental
regulation as well as to systems of voluntary obedience. Such an approach has further aided
NAB to accomplish expectations of community groups.

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References
Carè, R., 2018. Sustainability in banks: emerging trends. In Sustainable Banking (pp. 93-130).
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Hetze, K. and Winistörfer, H., 2016. CSR communication on corporate websites compared
across continents. International Journal of Bank Marketing, 34(4), pp.501-528.
Insight, S., 2015. Gearing up the Green Bonds. KpmG International https://www. kpmg.
com/Global/en/IssuesandInsights/Articlespublications/sustainable-insight/Documents/gearing-
up-forgreen-bonds-v2. pdf (Accessed october 15, 2015).
Islam, M.A., Jain, A. and Thomson, D., 2016. Does the global reporting initiative influence
sustainability disclosures in Asia-Pacific banks?. Australasian Journal of Environmental
Management, 23(3), pp.298-313.
Jain, A., Keneley, M. and Thomson, D., 2015. Voluntary CSR disclosure works! Evidence from
Asia-Pacific banks. Social Responsibility Journal, 11(1), pp.2-18.
Lewis, J.K., 2016. Corporate social responsibility/sustainability reporting among the fortune
global 250: Greenwashing or green supply chain?. In Entrepreneurship, Business and
Economics-Vol. 1 (pp. 347-362). Springer, Cham.
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global 250: Greenwashing or green supply chain?. In Entrepreneurship, Business and
Economics-Vol. 1 (pp. 347-362). Springer, Cham.
NAB.com., 2019. Nab And Cefc Announce Further $180m For Energy Efficient Assets. [online]
Available at: https://news.nab.com.au/nab-and-cefc-announce-further-180m-for-energy-efficient-
assets/ [Accessed 7 Sept. 2019]

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NAB.com., 2019. Natural Value. [online] Available at: https://www.nab.com.au/about-us/social-
impact/environment/natural-value. [Accessed 7 Sept. 2019]
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